Authorizes a tax credit for certain educational expenses
The bill's implementation is set to begin for tax years starting January 1, 2025, with taxpayers eligible for a tax credit equivalent to 100% of their qualified educational expenses. However, there are specific limitations placed on the amount of credit, as it cannot exceed the state adequacy target. This legislation marks a significant shift in Missouri's educational funding approach, emphasizing support for alternative schooling options while potentially shifting financial resources away from the public school system. The credits are non-transferable and will be treated as tax overpayments if they surpass the taxpayer's liability.
Senate Bill 867, known as the Missouri Parental Choice Tax Credit Act, introduces a tax credit for parents or guardians who incur educational expenses for their children enrolled in private or home schools. This bill aims to alleviate the financial burden on families choosing private education by allowing them to deduct qualifying expenses from their state tax liability. Under the provisions of the bill, qualified expenses encompass a wide array of educational costs, including tuition, textbooks, tutoring services, educational therapies, and technology devices, thereby promoting educational choice and opportunity for families across Missouri.
Notable points of contention regarding SB867 arise from concerns over the possible implications for public education funding. Opponents of the bill argue that increasing tax credits for private education may undermine public school budgets and exacerbate inequities in the educational landscape. They contend that this form of tax relief primarily benefits wealthier families who can afford private schooling while potentially disadvantaging families reliant on public education. Furthermore, there are worries that the bill could divert public resources towards private institutions, leading to a decline in public school performance and funding availability.
To ensure the smooth execution of the provisions within SB867, the Missouri Department of Revenue is tasked with promulgating rules for the enforcement of the tax credit program. Moreover, the bill includes a sunset provision that mandates the program will automatically end six years post-enactment unless reauthorized, aiming to reassess the program's efficacy and its impact on the state's fiscal landscape as well as its educational outcomes.